Aktipis Lab

ALT Education as a peacock's tail Spence's seminal model of education as a credible signal of productivity [13] is little known in biology. Although our teachers try to convince us that education gives us the skills that we need tc succeed in life, Spence argued that higher levels of education can lead to higher wages even if education fails to improve a person's productivity; education is like a peacock's tail [16]. Assume two types of workers in the population, type I with productivity 1, and type II with productivity 2, productivity being private information. Education has no impact on productivity, but the costs of education are negatively correlated with productivity, so the cost of achieving a level y of education for type I is y, and for type Il it is y/2. Assume also an employer who believes that there is a level of education y*, such that if y< y* then a worker's productivity is 1, and if y≥y* then it is 2. The employer correspondingly offers the wage schedule in Figure I.